Re: Why dont value investors write more covered calls?
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Seems to me that if most value investors go into a position with an idea of true intrisic value and will sell and move on when the company reaches that value, much like buffett recently did with petrochina, then they should be writing calls whenever they enter the position at the price they targeted as IV.
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Because people are greedy. Everyone I've asked about this says something to the effect that if they buy the stock at 50 hoping to sell at 90, they don't want to write calls at 60 or 70, or even 90, truth be told.
When I was working for a chip company, we got lots of options, ESPP, etc so I watched the stock every day and got to know it well. I would say for the 5 years I worked there and held the stock in my personal account, I probably averaged 50% a year selling covered calls.
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